Two Very Important Reminders:

1. Upstream natural gas pipeline TC Energy starts billing higher transportation rates April 2025.  Most suppliers will pass this new rate increase to natural gas customers behind Columbia Gas of Ohio and Duke Energy.  Columbia Gas of Ohio’s customer adder for those buying natural gas supply directly from them is going up from $1.66/mcf to $3.25/mcf in large part due to the TC Energy rate increase.
2. The Regional Transmission Organization (RTO) that serves Ohio named PJM will increase their Capacity rate by 833% beginning June 2025.  This increase will eventually effect all Ohio Consumers behind AEP, Ohio Edison, Cleveland Illuminating, Toledo Edison, Duke Energy and AES.  Electric suppliers are handling this capacity increase a variety of ways. Many consumers will see their costs go up beginning June and July 2025.  This increase is going to be very impactful with even small businesses seeing their annual electric spend going up thousands of dollars.  Larger business, municipal communities, schools, manufacturers will likely see their annual electric spend go up tens of thousands or even hundreds of thousands of dollars from June 2025 – May 2026.  The higher PJM capacity cost will continue to stay high for at least the next three years beginning June 2025.

If your business has questions on how these natural gas and power cost increases will effect your business, what impact they will have on your annual spend and would like to discuss how to possibly lower the impact of these upcoming cost increases, please feel free to reach out to us at RD Energy to schedule a discussion.  

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During the winter of 2024–2025, U.S. wholesale natural gas prices were influenced by several key factors:

1. Severe Winter Weather
2. Increased Liquefied Natural Gas (LNG) Exports
3. Industrial Sector Demand
4. Lower Storage Levels

As winter transitioned to spring, natural gas prices began to decline due to:

1. Milder Weather Reducing Heating Demand
2. Record Production Levels: U.S. natural gas production reached record highs, averaging105.8 Bcf/d in March.
3. Extremely warm March resulting in an early start to natural gas storage injections

Where do prices natural gas prices go from here?

1. Mild weather, early storage injections and high daily natural gas production could push prices down in the next 30 days
2. Near record liquified natural gas exports (LNG) could keep a strong support for U.S. natural gas prices keeping them from dropping too far
3. Either hot or mild summer temperatures will play a role in natural gas prices since the #1 fuel source for power generation is natural gas
4. Hurricanes in the Gulf could hurt natural gas supply or LNG exports or both pushing natural gas prices up or down based on supply/demand results

New LNG export terminals coming online in Q4 will likely add to natural gas demand putting upward pressure on prices as early as Q3